Innovating Like China: a Theory of Stage-Dependent Intellectual Property Rights
Series
Working Papers
Type
working paper
Date Issued
2012
Author(s)
Abstract
Inspired by the Chinese experience, we develop a Schumpeterian growth model of distance to frontier in which economic growth in the developing country is driven by domestic innovation as well as imitation and transfer of foreign technologies through foreign direct investment. We show that optimal intellectual property rights (IPR) protection is stage-dependent. At an early stage of development, the country implements weak IPR protection to facilitate imitation. At a later stage of development, the country implements strong IPR protection to encourage domestic innovation. We also calibrate the model to aggregate data of the Chinese economy to simulate the optimal path of patent strength, which is increasing as the country evolves towards the world technology frontier, and this dynamic pattern is consistent with the actual evolution of the patent system in China. Furthermore, we provide empirical evidence based on a dynamic panel regression to support the key mechanism in our theoretical model.
Language
English
Keywords
economic growth
stage-dependent intellectual property rights
HSG Classification
contribution to scientific community
HSG Profile Area
SEPS - Economic Policy
Refereed
No
Publisher place
Durham
Number
14
Subject(s)
Eprints ID
221872
File(s)![Thumbnail Image]()
Name
WP 2012_14 Durham.pdf
Size
315.48 KB
Format
Adobe PDF
Checksum (MD5)
b4286c3678379bbfcf2970deb6d2f70c